Netflix reported a 16% increase in revenue to $10.247 billion for the December quarter as the streaming platform plans to build more advertising capabilities
However, the company noted it had many “formidable” competitors across traditional entertainment and big tech.
“We’re fortunate that we don’t have distractions like managing declining linear networks and, with our focus and continued investment, we have good and improving product/market fit around the world,” the company said in its investor letter.
Netflix said it was on track to reach sufficient scale for ads members.
A top priority in 2025 is to improve the offering for advertisers so that Netflix can substantially grow advertising revenue.
“In November, we rolled out our first party ad tech platform in Canada and we’ve now fully transitioned all ad serving in Canada in-house.
“Over time, our ad tech platform will allow us to better deliver critical capabilities to advertisers including expanded programmatic availability, enhanced targeting and additional measurement and reporting.
“We’ll roll out our first party ad platform in the remaining ads countries in 2025, starting with the US in April.”
eMarketer senior analyst Ross Benes said two of Netflix's official 2025 priorities are increasing ad revenue and developing more live programming.
“What was recently anathema, is now among the company's top priorities,” he said.
“So when Netflix stated in its shareholder letter that ‘we're not focusing on acquiring rights to large regular season sports packages,’ it wouldn't be surprising for Netflix to reverse course in the near future and acquire more sports rights. Expect the company to continue adapting by embracing strategies that it said it wouldn't."
Netflix said it now has more than 300 million paid memberships which meant, with multiple people per household, a global audience estimated at more than 700 million.
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